Some D.C. Workers Profit From Grant for Homeless

By Arthur S. BrisbaneJune 9, 1986

A small group of D.C. government employes has profited substantially from the massive infusion of federal dollars received by the D.C. Coalition for the Homeless to attack the problems of the homeless in the District.

The federal government gave the coalition a $3.7 million grant in September to open and operate a temporary shelter in Anacostia and find more permanent shelter space around the city.

While many homeless men and women benefited from the coalition's efforts, a number of D.C. workers -- several of whom worked for the city agency that has responsibility for the homeless -- also profited from the grant monies.

Those employes did not earn the money while acting in their official government capacities. Working on the side, they received thousands of dollars in finder's fees for real estate deals, payments for casual and supervisory labor, a payment from a contractor that is being investigated as a possible kickback, a real estate lease payment and reimbursements for expenses.

The role of the city employes fueled a battle in the coalition that led in part to the resignations last week of three top coalition officials, board members say.

Elisabeth Huguenin, the president of the organization who quit in protest last Tuesday, said in a statement that she had discovered "such disregard for the needs of our homeless population and such wasted expenditures that my personal and professional ethics prevent me from remaining president of this organization."

Lorraine P. Rue, director of the D.C. Office of Emergency Shelter and Support Services, said Friday that the finder's fees and other payments to city workers were questionable, although they do not appear to be illegal.

"I would question whether there might be a conflict of interest," she said. "I wouldn't want to be involved in anything like that."

Meanwhile, with the coalition's real estate deals and other financial affairs under investigation by the D.C. police and the FBI, $700,000 remains from the $3.7 million grant.

D.C. government employes have played a major role in the coalition's activities since the coalition received its federal grant Sept. 30 to establish a temporary shelter in Anacostia and smaller, permanent shelters around the city.

Lawrence Guyot, a volunteer services coordinator in the Department of Human Services, and Dennis Bethea, the former director of emergency shelter and support services, served on the coalition's board and, along with others, received funds derived from the coalition's federal grant. An accounting of the city workers includes:

*Dorothy Kemp. a former employe in the Office of Emergency Shelter and Support Services' emergency assistance program who has been transferred to the Department of Housing and Community Development, Kemp received a $3,000 finder's fee from the coalition after she helped the organization locate and purchase a shelter at 455-457 Florida Ave. NW.

The fee -- about 2 percent of the $148,000 purchase price -- was "legit," Kemp said. "I did it on my own time. I think the way the coalition looked at it, I was a consultant -- you put this together, you put us in touch with the owners . . . . There was nothing unusual about what I did."

Guyot, who handled many of the coalition's real estate transactions, said the group provided finder's fees "for everyone who was actively involved in the purchase of buildings."

*Robert E. Taylor. A counselor employed by shelter and support services, he received a finder's fee of $1,500 for assisting the coalition in its purchase of a $75,000 property at 87 New York Ave. NW, according to Guyot and Deborah J. Ellis, the former secretary of the coalition who resigned with Huguenin last week.

"He was the one who located it and referred it to me," Guyot said. Taylor, who is out of the city on personal leave, could not be reached for comment.

Also, Taylor received at least $3,375 from the coalition for casual and supervisory labor, primarily at the organization's now-closed Anacostia shelter, according to copies of coalition checks.

Coalition records show that between Oct. 24 and Dec. 18, Taylor was paid for 21 days' work -- including administrative duties, moving, trash pickup and other services -- at a rate of about $160 a day.

*Vernell R. Tanner, a D.C. police officer. He received $21,000 in lease payments from the coalition in October on a building at 1333 Emerson St. NW that he was hoping to buy but had not yet acquired. Tanner at the time was having financial difficulties and had applied for -- and later received -- more than $9,000 in city emergency housing assistance funds. Kemp processed the assistance application and Bethea approved it, according to city officials.

Tanner has said that he did nothing illegal in accepting rent on a property he did not own and that he will repay the coalition when an agreement is reached on his expenses in connection with the property.

James Edward Mercer, an attorney retained by the coalition, said last week that the $21,000 has not been repaid.

*Dennis Bethea. According to an affidavit signed by a contractor who performed renovations at the Emerson Street and Florida Avenue shelters, Bethea demanded $5,000 in return for his role in arranging an agreement for the contractor to do $27,000 in renovation work. The contractor and Taylor, who also submitted an affidavit that was turned over to the coalition board, said a $1,000 payment was actually made to Bethea.

In January Bethea resigned his post as director of shelter and support services -- as well as his coalition board membership -- after acknowledging that he had accepted what he called a $1,000 loan from the contractor. Bethea has said that he repaid the loan and that there was "no intent to do anything improper."

Police and the FBI are investigating whether the $1,000 payment may have constituted a kickback.

*Lawrence Guyot. He was paid $630 in compensation for efforts to negotiate the coalition's grant with the federal government, he said. The check was written Feb. 18 -- eight months after the work was completed, according to coalition records.

Guyot said in an interview that he was legally entitled to the reimbursement but did not collect it immediately because "I didn't need it then."

In addition to these direct payments to city employes, former coalition president Huguenin has objected to mileage and restaurant expenses submitted by coalition Executive Director Patricia Makin in connection with the efforts of Makin and Guyot to locate and acquire shelter properties.

Former coalition secretary Ellis, a Huguenin ally, said another source of disagreement among her, Huguenin and Guyot, who resigned as the group's treasurer in April, was the payment of $6,470 for pharmaceutical supplies to a pharmacy owned by Makin's husband, Alfred (Pat) Makin.

Ellis and Guyot, in interviews, said they had questions about a "conflict of interest," but Guyot said a coalition staff member contacted some lawyers and determined that there was no problem.

Alfred Makin said he "certainly did not make any big profit" from the arrangement. "The only thing I know is that when the whole program started, they coalition officials were running around helter-skelter trying to get everything organized," said Alfred Makin. "I think in the interest of time I was selected."